In critical incident interviews, 101 Chinese mainland employees each described a work-related occasion where ethical values were at stake. Case examples and structural equation analyses indicated that clearly understood ethical rules facilitated open-minded discussion of opposing views, i.e. constructive controversy, which in turn developed interactive justice, strengthened interpersonal relationships, and promoted confidence in future discussions. However, clarity about ethical rules and engagement in constructive controversy was perceived to have no substantive ethical impact. This result was interpreted as indicating that common understanding among employees about the content of the extant ethical rules combined with open-minded discussion of the rules does not necessarily lead to agreement that bringing behavior into alignment with the extant rules is necessarily the best moral solution, and as suggesting that using constructive controversy to develop ethical rules may be better than imposing them from the top.